One year ago, President Obama declared that America was on the cusp of a “Recovery Summer.” His hope was that the $1 trillion stimulus and his health care plan known as Obamacare, which he and the Democrat-controlled Congress enacted, would create a new America. He assumed that along the way jobs would be created. Today, it is clear that the recovery did not occur and that, in many respects, America’s economy has worsened. The policies the president enacted have hurt the economy.
One example is the energy sector. When I first ran for Congress in 2008, the situation was similar to today. Gas prices were at record highs, driven by a weakening dollar and a resistance against fully developing America’s energy resources. My message was, “Louisiana can help lead America out of the energy crisis.” This remains true today. All we need is for the president and his administration to put aside wishful thinking and focus on real solutions to America’s energy needs.
It is clear the energy sector can create jobs and help restore our economy. On the Gulf Coast, a commitment by the administration to resume issuing offshore drilling permits at the historic average could create more than 230,000 jobs. This benefit would come not just from having more affordable and abundant energy, but also from industries throughout the country that participate in oil and gas production. These companies, which employ millions with good-paying jobs, have not achieved their potential as a result of the production slowdown off the Outer Continental Shelf. The impact is both direct, for the manufacturers of the pipelines and service boats that the petroleum industry requires, and indirect, for the steel manufacturers who supply the materials needed for both.
While the administration has recognized the role energy plays in economic recovery, the problem is one of misplaced priorities. As a candidate for president in 2008, Mr. Obama pledged to create 5 million “green-collar jobs” (those related to alternative energy) within the next decade. However, in the time since, his focus on this goal has required enormous subsidies and government assistance for even the appearance of success. While new technologies can contribute to energy security, they will be inadequate to fuel the U.S. economy. To put this in perspective, wind and solar currently supply around 1 percent of our nation’s electricity, while coal-fired power plants supply more 50 percent and natural gas provides over 20 percent. When combined, coal, natural gas and petroleum contribute nearly 90 percent of America’s energy consumption.
It is not just the lack of capacity for wind, solar and other renewable energy sources to supply energy; it is the expense of these energy sources. Wind and solar energy are subsidized at approximately $25 per megawatt hour of electricity while natural gas and petroleum at only 2.5 cents per megawatt hour. Even with this, wind and solar energy are still more expensive. This affects jobs. An electricity-intensive industry is more likely to stay in a state or a country where electricity is cheaper. To keep electricity less expensive is a competitive advantage for companies that build and expand in the U.S., which means keeping and creating jobs here.
High energy costs impact all Americans. The price of electricity and gas affects individuals, families and businesses. It diverts money that could be spent on job creation to making ends meet. It directly and indirectly increases unemployment. As America hopes for a better recovery, I ask that President Obama set a new course, one that recognizes that the road to true economic recovery goes through domestic production of American energy.
U.S. Rep. Bill Cassidy is a Republican from Baton Rouge. The above first appeared in today’s Houma Courier.